Complete Chapters Solutions Included
Appedix A Solutions Included ✅
Appendix B Solutions Included ✅
, APPENDIX B
PAYROLL PROJECT SOLUTION
NOTES TO THE INSTRUCTOR
In this document, you will find key reports for the online version of the payroll project, using the Automated
General Ledger Software, running on the CengageNOWv2 learning management system. For each part of
the project, the student begins with any errors from previous parts corrected, getting a “clean start” for each
new payroll period.
The General Ledger report for key payroll accounts for the entire project will be found at the end of this key.
You can find the appropriate balance at the end of any payroll period by looking for the last posting date in
the account before, or including, the desired payroll date.
The Automated General Ledger Software includes all transactions through the December 18 payroll.
CengageNOWv2 contains the completion of the end-of-year tax forms (solutions beginning on page
B-51), the end-of-year tax payments (solution on page B-67), and the project audit test (solutions beginning
on page B-68).
There are two primary areas where amounts in this project may differ from the manual project in the
textbook. First, there are occasional one-cent rounding differences on tax calculations, which may
accumulate or offset each other over the course of the project. Second, the text project uses the biweekly
wage bracket table to look up Federal Income Tax withheld. Automated General Ledger Software, on the
other hand, uses the percentage method with the annualized tables from IRS Publication 15-T, as do many
computerized systems. This may result in up to two dollars of difference in FIT withheld, although the
differences are usually much smaller.
On the next page are the 2025 Percentage Method Tables for Automated Payroll Systems from the 2025
IRS Publication 15-T and a sample calculation using this method.
B–1
© 2026 .
,B–2 Payroll Accounting
© 2026 .
, Appendix B B–3
Ferguson 10/09
Earnings this period: $2,250.00
less: Simple Plan deduction (in later periods):
Taxable earnings this period: $2,250.00
times: Number of periods: 26
Annualized income: $58,500.00
2020 W-4 Step 2 not checked:
Adjustment for filing status married filing joint from
Pub. 15-T Worksheet page 5, letter 1g: $12,900.00
Adjusted Annual Wage Amount: $45,600.00
less: Tax bracket bottom (Percentage
Method Tables – Standard Withholding bottom): $40,950.00
Earnings in excess of tax bracket bottom: $4,650.00
times: Marginal rate (from table above): 12.0%
Tax on excess earnings: $ 558.00
plus: Tax at bracket bottom: 2,385.00
Annualized tax due: $2,943.00
Computed tax for this period (divide by 26): $113.19
Manual table look-up tax due (biweekly, married
filing joint – Chapter 7 answer): $114.00
© 2026 .
Appedix A Solutions Included ✅
Appendix B Solutions Included ✅
, APPENDIX B
PAYROLL PROJECT SOLUTION
NOTES TO THE INSTRUCTOR
In this document, you will find key reports for the online version of the payroll project, using the Automated
General Ledger Software, running on the CengageNOWv2 learning management system. For each part of
the project, the student begins with any errors from previous parts corrected, getting a “clean start” for each
new payroll period.
The General Ledger report for key payroll accounts for the entire project will be found at the end of this key.
You can find the appropriate balance at the end of any payroll period by looking for the last posting date in
the account before, or including, the desired payroll date.
The Automated General Ledger Software includes all transactions through the December 18 payroll.
CengageNOWv2 contains the completion of the end-of-year tax forms (solutions beginning on page
B-51), the end-of-year tax payments (solution on page B-67), and the project audit test (solutions beginning
on page B-68).
There are two primary areas where amounts in this project may differ from the manual project in the
textbook. First, there are occasional one-cent rounding differences on tax calculations, which may
accumulate or offset each other over the course of the project. Second, the text project uses the biweekly
wage bracket table to look up Federal Income Tax withheld. Automated General Ledger Software, on the
other hand, uses the percentage method with the annualized tables from IRS Publication 15-T, as do many
computerized systems. This may result in up to two dollars of difference in FIT withheld, although the
differences are usually much smaller.
On the next page are the 2025 Percentage Method Tables for Automated Payroll Systems from the 2025
IRS Publication 15-T and a sample calculation using this method.
B–1
© 2026 .
,B–2 Payroll Accounting
© 2026 .
, Appendix B B–3
Ferguson 10/09
Earnings this period: $2,250.00
less: Simple Plan deduction (in later periods):
Taxable earnings this period: $2,250.00
times: Number of periods: 26
Annualized income: $58,500.00
2020 W-4 Step 2 not checked:
Adjustment for filing status married filing joint from
Pub. 15-T Worksheet page 5, letter 1g: $12,900.00
Adjusted Annual Wage Amount: $45,600.00
less: Tax bracket bottom (Percentage
Method Tables – Standard Withholding bottom): $40,950.00
Earnings in excess of tax bracket bottom: $4,650.00
times: Marginal rate (from table above): 12.0%
Tax on excess earnings: $ 558.00
plus: Tax at bracket bottom: 2,385.00
Annualized tax due: $2,943.00
Computed tax for this period (divide by 26): $113.19
Manual table look-up tax due (biweekly, married
filing joint – Chapter 7 answer): $114.00
© 2026 .
